Updated over 4 years ago on . Most recent reply
management fees when calculating a rental property
Does anyone know what are the general management fees for new jersey. North and south. Thank you
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- Real Estate Broker
- Cody, WY
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There is no "ordinary" so you really have to investigate the fees. Some will charge 10% but that includes everything. Some will charge 10% plus a leasing fee, lease renewal fee, markup on maintenance, etc. Others start with a flat fee of $100 per rental, or something to that effect. Some charge a setup fee, a minimum management fee even when the rental is empty, keep the late fees, keep the pet rent, etc. There are a lot of variables and you really have to investigate. I've seen property managers charge as little as 6% but after adding on all their extra fees they are actually over 10%. It's a great marketing scheme.
My recommendation? Make a quick spreadsheet (or even a piece of paper) and shop around. Talk to the PM and see what their fees - all of them. Then interview another and see what their fees are - all of them. Do this for at least three companies, then run your property through a few scenarios to see what it will cost you. What if you lease for one year and then have to place a new tenant? Two years? What if the Tenant signs a one-year lease but then leaves after six months? What if the Tenant quits paying after 9 months and has to be evicted?
- Nathan Gesner
